MVIL clarifies Woodlawn affair

The National National

By MALUM NALU
Motor Vehicles Insurance Ltd (MVIL) says more than K100 million worth of investment decisions it has made in recent years are “legacy issues” which have been dealt with.
Acting chief executive Bafino Koi said this yesterday after the investments were raised in the Auditor-General’s Report and tyabled in Parliament.
He also explained why MVIL exceeded its 2015 budget by more than K8 million.
According to the Auditor-General’s Report, MVIL:
l Made a loss of more than K38 million on the controversial K100 million investment in Woodlawn Capital Australia. The Woodlawn affair goes back to July 2009 when Motor Vehicles Insurance transferred K96 million kina to Woodlawn to invest and manage with the aim of growing the money over time. Investigations showed that Woodlawn Capital at the time it received the money from MVIL was not licensed to conduct business as a financial investment company. Woodlawn did not hold a valid financial services licence under the Australian Securities and Investment Commission. There has since been a long-running court case to recover the money;

  • Made a K50 million grant to the National Capital District Commission in 2013 for road works in the city without the approval of the board chairman, secretary and the minister for finance;
  • Lost more than K20 million in a “failed project” known as Koki Heights Land between 2008 and 2011; and
  • Exceeded its budget for 2015 by K8, 318,778.

“MVIL has pursued the Woodlawn case with the New South Wales High Court and has fully recovered a substantial component of the K100 million in the overseas investment,” Koi said.
“The Koki Heights Land Project was part of the failed K100 million Woodlawn Capital investment in 2009.
“The Koki Heights Land development proved unrecoverable and was transferred to Kumul Consolidated Holdings.
“MVIL’s strategy now is to focus only on its key mandate of compulsory third-party insurance and also general insurance through its other subsidiaries.
“All documentations and approvals relating to the K50 million grant to the NCDC are in order.
“The grant was part of the MVIL road safety programme supporting safe and better roads in the NCD.
“The funding was sourced from NCD’s component of the motor vehicle registration fees.
“To date, K30 million of this has already been recouped and monthly repayments are continuing for the balance of K20 million.”
Asked about the budget exceeding K8 million in 2015, Koi said: “You need to look at that in a holistic approach, the bottom line to what has happened.
“There are savings on other items as well.
“The overall perspective of the business is that we are okay.”